Sweden's Karo Bio cuts a quarter of staff

A week after pulling the plug on its late-stage cholesterol compound eprotirome, Karo Bio has laid off 16 of its 70 employees.

The Swedish firm says that the downsizing is to reduce costs in the wake of terminating the Phase III programme on eprotirome, a thyroid hormone analogue which could lower ‘bad’ cholesterol levels in patients already taking statins, after an animal study demonstrated unwanted effects following long-term exposure.

Interestingly, the job losses are less than had been announced in November. Then, Karo Bio said it would be laying off 25 staff after spinning off its preclinical activities but that plan has now been halted, due to the eprotirome news.

The company noted that together with other personnel changes in 2011, the reduction in staff will result in annual savings of around 17 million Swedish kroner, about $2.6 million.